Correlation Between Argen X and Air Products
Can any of the company-specific risk be diversified away by investing in both Argen X and Air Products at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Argen X and Air Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argen X and Air Products Chemicals, you can compare the effects of market volatilities on Argen X and Air Products and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Argen X with a short position of Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argen X and Air Products.
Diversification Opportunities for Argen X and Air Products
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Argen and Air is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Argen X and Air Products Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products Chemicals and Argen X is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Argen X are associated (or correlated) with Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products Chemicals has no effect on the direction of Argen X i.e., Argen X and Air Products go up and down completely randomly.
Pair Corralation between Argen X and Air Products
Assuming the 90 days trading horizon Argen X is expected to generate 0.52 times more return on investment than Air Products. However, Argen X is 1.92 times less risky than Air Products. It trades about 0.06 of its potential returns per unit of risk. Air Products Chemicals is currently generating about 0.02 per unit of risk. If you would invest 34,600 in Argen X on September 19, 2024 and sell it today you would earn a total of 25,960 from holding Argen X or generate 75.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Argen X vs. Air Products Chemicals
Performance |
| Timeline |
| Argen X |
| Air Products Chemicals |
Argen X and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argen X and Air Products
The main advantage of trading using opposite Argen X and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argen X position performs unexpectedly, Air Products can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Air Products will offset losses from the drop in Air Products' long position.| Argen X vs. Vitec Software Group | Argen X vs. European Metals Holdings | Argen X vs. URU Metals | Argen X vs. Silvercorp Metals |
| Air Products vs. Summit Materials Cl | Air Products vs. Sealed Air Corp | Air Products vs. Alaska Air Group | Air Products vs. Delta Air Lines |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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